I just don’t see the justification for reindustrializing the US. The manufacturing countries tend to make goods that are of comparable quality at wages that virtually no US citizen would be willing to accept. Take the new clean room factory that Intel just opened in Vietnam last year. The workers there make what amounts to $100 a month. Without large hoards of desperate people, there’s no way to compete with that, especially since it’s obvious that their lack of capital is becoming less of an issue.

On the upside, it makes goods so cheap that even the lowest on the wage todem pole have cell phones, TV’s, computers, etc.

So manufacturing and government jobs went topsy turvy. I get that point. And I agree. Government has gotten too big.

I’m just curious, though, and forgetting government jobs for a moment, what is the comparison of manufacturing jobs between the 60’s and today? I’m not trying to make a point here. I’m honestly curious.

Apple just became the most recognizable brand in the world (beating Google) but where are their products made? Oh yeah, in China. (The infamous Foxconn plant.)

GM closed plants in the United States and opened them in Mexico.

Why do companies choose to do this? Is it because of an increase in government jobs? Or some other reason?

Should companies that want American dollars make an effort to hire American workers?

Long time no hear . American manufacturing has become more efficient requiring fewer workers and it has moved more to high value products . We always did have Boeing making airplanes, and International Harvestor making farm equipment, and Caterpillar making construction equipment . Then we have medical device and drug manufacturing . The low value textile and electronic manufacturing won’t come back .

If we are to hang on to these high paying jobs, our anti business government had better stop declaring war on them .

If you were a corporation that had to show profits to keep your shareholders satisfied so you could continue to stay in business, what factors would you take into consideration in determining where to locate?

In any corporate decision, a determination has to be based on the estimated return on investment, after doing a comprehensive cost/benefit analysis. A corporation that wants to stay in business has to deliver the highest quality product for the lowest price possible. That’s their competitive edge.

Things that governments do that impact the cost of doing business in their country (or state or county) are the things that ultimately determine whether businesses will tend to migrate into or out of their jurisdiction.

For starters, the United States has one of the highest federal corporate tax rates in the world. When you add state corporate taxes on top of that, most of the U.S. has a higher combined corporate tax rate than anywhere else in the world.

Second, the United States has some of the most stringent regulations on businesses. The cost of compliance with those regulations adds enormous costs to the already high cost of doing business here.

Third, our minimum wages and union control of many industries drive the cost of labor up in a continuing spiral. In a free market, when jobs are scarce, people can decide it’s worthwhile to sell their services for less money because they’d rather have a job than not have a job. When the economy loosens up and more jobs become available, if they prove to be a valuable employee, their employer will pay them more to keep them rather than lose them to a competitor. When employees are not allowed to sell their services for less (because of minimum wage laws or union scale), they are at a disadvantage in competing for scarce jobs.

A coroporation that has to compete in the global marketplace has to be able to produce products at comparable costs to other corporations that compete in the global marketplace. It is becoming increasingly difficult for corporations to do that in the United States. Therefore, they are moving overseas.

Should companies that want American dollars make an effort to hire American workers?

Most products Americans buy are made in China so, apparently, most Americans don’t think it matters. In an ideal world, it would be nice if companies had the luxury to be able to make decisions on that basis, but companies that don’t make wise business decisions go out of business. And most large corporations are not just competing for American dollars, they’re competing in a global marketplace. So, due to the policies of the U.S. government, they can no longer afford to hire American workers or locate their businesses here.

This really is a pointless discussion…ugh…many, many manufacturing jobs that used to be here in America are NEVER going to come back here (if at all) until we have an equal playing field when it comes to trade regulations, labor laws, and environmental regulations.

“the United States has one of the highest federal corporate tax rates in the world. When you add state corporate taxes on top of that, most of the U.S. has a higher combined corporate tax rate than anywhere else in the world.”

Bogus…many, many American companies don’t pay the top tier federal corporate rate (even though they probably should), and we’ve heard very, very recently that many of the top earning corporations basically don’t pay any U.S. (federal or state) taxes.

“the United States has some of the most stringent regulations on businesses”

…and many of those regulations were weakened by the Bush Regime, and where did that get us? Into the literally the biggest economic downturn since the Great Depression, period.

“our minimum wages and union control of many industries drive the cost of labor up in a continuing spiral.”

LOL…yea, right…because people don’t have the right earn a livable wage…sheesh…you’re not even trying here anymore NYD. All this baloney is just stock, totally debunked Right-wing drivel…please…give it up…

We live in a global marketplace, and it’s waaaaay past time to get over that FACT.

So the people who work at Boeing , Caterpillar, International Harvester , should all hope that President Obungler raises the taxes on their employer. Raising costs will help them compete internationally . Screw the evil Corps and that will create American jobs ?

That class warfare our President has promoted has born fruit . The high schoolers and college grads who thought Obama was the one will not be fooled twice . When you are unemployed and living with your parents for 3 years, why would you vote again for the clown who made it happen ?

Mr. Community Organizer knows absolutely nothing about economics . Bashing the rich and blaming corporations has not produced the economic turn around our fearless leader needs to get another 4 years . I wonder what could have gone wrong . I mean in college discussions that Obama had as a Professor , the theory said it worked . It also worked so well in Greece .

Ugh…the foolish old man returns…with nothing much to say, as per usual.

If one if not going to earn a wage that one can live on, then what is the point of working?!?

“What exactly is a ‘living’ wage and how does one define and/or justify it in economic terms?”

LOL…the work has already been done on this issue in a host of states…even state in the Pacific NW where you morons apparently live! A living wage is simply the minimum hourly wage necessary for an individual to meet basic needs, including shelter & other incidentals such as clothing & nutrition for an extended period of time or a lifetime.

The definition of living wage you offer, Mr. Guy, is a giant fuzzy, simply because you define it in terms of what any particular worker may need. Worse, it suffers from a fundamental error in economics that the price of anything is determined by its cost. In fact, price is determined by what the purchaser is willing to pay. If the cost of producing the product exceeds the amount the consumer will pay, either the product doesn’t get produced or the producer goes broke. Which is precisely what is happening.

…which is the entire point of a living wage in the first place! Again I’ll ask you, if one is not going to earn a wage that one can live on, then what is the point of working?!?!

“Which is precisely what is happening.”

Wrong again old man. What has happened over the last 30-40 years is that many people have seen their wages basically stagnant (at best) while the cost of everything has continued to go up. This has left people & families with the choice of either working more & more hours (or more & more jobs) or buying more & more of their basic needs on credit, which recently came to a screeching halt in literally the worst economic downturn since the Great Depression. This downturn was mostly caused by GOP-sponsored deregulation of various types of businesses (undoing much of what was learned after the Great Depression) so that those businesses could make more short-term profit. It short…it was almost all driven by blind, selfish greed, which is the world that you “conservatives” champion day in & day out. Your time has passed old man…now shuffle on into oblivion…the world will be a better place without your kind!

What drives the free enterprise system and makes it successful is not the “greed” you deplore. It is enterprise. When one desires more from the marketplace, as in a larger income for one’s labor, the burden is upon the desiree to demonstrate the enterprise to make what he has to offer of greater value. He can do that by changing occupations, gaining additional education or skills, or he can invent a better mousetrap. The free market rewards enterprise. It owes no one anything.

I deplore the devaluation of the dollar and its affects as much as you do, but that is a function of the government mandating entitlements to the “deserving” (whether earned or not) and paying for them with money it creates for that purpose. The cure to the problem of inflation is to stop the devaluation of the dollar. Adding wage inflation to the mix via minimum wage laws only adds fuel to the fire. (And, incidentally, increases unemployment.)

“What drives the free enterprise system and makes it successful is not the ‘greed’ you deplore. It is enterprise.”

LOL…nice double-talk there old man. That sounds like the stupid Coolidge phrase, “The business of America is business.” Real “profound” there…not…

I’ll ask you for third & last time old man, if one is NOT going to earn a wage that one can live on, then what is the point of working?!?! No answer for that eh? What a surprise…lol…

“I deplore the devaluation of the dollar and its affects as much as you do”

…but you continue to champion the efforts of the very people that have very recently been mostly responisble for its devaluation…the GOP & their horrible fiscal & economic policies! If you’re not part of the solution, then you are part of the problem my sad, old friend. Wake up!

Our country’s recent increase in federal deficits have little to do with entitlements & everything to do with wasteful tax cuts (for mostly the rich), wars of choice for no reason, and horrible deregulation policies that caused literally the worst economic downturn since the Great Depression…just ask the CBO.

“The cure to the problem of inflation is to stop the devaluation of the dollar.”

LMAO…Silent Cal would be very, very proud of your continued, meaningless double-talk old man. Ugh…

No, it really doesn’t. Paying a living wage is good for the local economy because small local businesses rely on local dollars-more money for city dwellers will mean more customers for municipal businesses. Paying a living wage will create new business as new revenue promotes new commerce. Many economists argue that higher pay results in increased productivity by making jobs more desirable to both get & to keep, thereby reducing recruitment, training & supervisory costs associated with high rates of turnover.

Past increases in the minimum wage did NOT lead to job loss. In fact, according to the U.S. Dept. of Labor, increases in the minimum wage have had a slightly positive effect on the U.S. economy & employment.

Wages are just one of many factors that make up the cost of any item. Factors such as manufacturing, transportation, equipment, rent, advertising, business location, income demographics of the community, employee recruitment & training and other expenses all add together with wages to create the cost of an item. The cost of goods does NOT have to automatically rise just because one small portion of their make-up increases. An example of the non-inflationary relationship between wages & the cost of goods can be found in the 1996 report entitled, “Think Again: A Wage and Price Survey of Denver Area Fast Food Restaurants.” This survey focused on 4 national fast food chains: Arby’s , Burger King, MacDonald’s & Taco Bell-all major employers of entry level, low-wage workers. The conclusion of the study was that higher prices did NOT necessarily accompany higher wages. In fact, “survey results indicated that higher starting salaries are coupled with only slightly higher, identical, and in many cases lower prices than those in stores that paid a lower starting wage.”

The FACT is that many businesses today don’t respect the value of their own workers on the same level as they value the other components of doing business…like manufacturing, advertising, transportation etc.. This needs to END so that anyone that literally works a 40 hr week won’t have to do it either from under a bridge or by holding down a second full-time job.

Minimum wage jobs are mostly support jobs…like low paying jobs in the restaurant industry, janitorial, construction labor, landscaping, laundry & the like. These are support type businesses, which support “principal” businesses that pay well above the minimum wage! If Intel moves to town, it does NOT make the decision to do so based on minimum wage salary scales in as much as it does NOT employ workers at that low wage level! Even in manufacturing businesses, workers make up only a small portion of budgetary concerns, which include manufacturing costs, business location, shipping/ transportation, advertisement, training, warehousing & wages.

There have been several attempts in the NYC area & in many, many other cities across the nation to have a living wage standard set through all recipients of govt. contracts, and the sky literally hasn’t fallen. In NYC, this amounted to a $10-11/hr wage depending on part or full-time status, on health benefits levels, etc.. This is by no means an unreasonable request as it amounted to only ~$21-23,000/yr. The sectors most impacted by these policies were homecare workers, assistant day care workers, kitchen staffs (senior centers, day care centers, food pantries, etc.), some entry level clerk-typists or reception workers, etc..

Anyone that works 40 hrs/wk should be able to afford some kind of housing, period.

I’ll ask you for third & last time old man, if one is NOT going to earn a wage that one can live on, then what is the point of working?!?! No answer for that eh? What a surprise…lol…

The objective of trading labor for income is why one works. But the value of the labor traded is not determined by what the laborer needs, who happens to be the seller in the transaction. The value of the labor is determined by how much demand there is for it. If the value is inadequate on either end of the equation, the transaction doesn’t happen absent some form of government price control. Given that artificial pricing, either the buyer refuses to hire – leading to unemployment – or the artificial cost is passed to the consumer of the end product – if that is possible. If such pass along is not possible, again unemployment is the result. Alternatively, if it is passed, the result is price inflation, leading to the rich getting richer and everyone else getting poorer.

…and if one is trading one’s labor for less than it takes for that person to live, then there’s basically NO point in working, period end of story.

“Given that artificial pricing, either the buyer refuses to hire – leading to unemployment – or the artificial cost is passed to the consumer of the end product – if that is possible”

…which it frequently isn’t. Once again, there is exactly ZERO evidence that raises the minimum wage causes more unemployment in the USA. One can continue to believe in that fallacy at one’s own risk, old man.

“Alternatively, if it is passed, the result is price inflation, leading to the rich getting richer and everyone else getting poorer.”

As for “the rich getting richer and everyone else getting poorer”, the policies of the GOP over the last 30+ years have down that job very, very nicely, which, of course, you fully support, old man. Run along now…

I realize that Mr. Guy will not answer me, but as he runs down capitalism, I want him to defend the failure of the Obama Administration to turn around the economy . Obama is the closest thing to a Mr. Guy Socialist that we have ever had as a President . So why did Socialism fail, again ? Defend the guy you put in power .

Mr. Guy: “and if one is trading one’s labor for less than it takes for that person to live, then there’s basically NO point in working, period end of story.”

As said by a born loser. The whole point of the free enterprise system is that initiative and enterprise are rewarded. Only a loser says that what I want to do isn’t adequate, so I’ll just quit. If one’s labor is inadequate to support one’s desired lifestyle, the burden is on one to enhance the value of one’s labor. It is not a function of government to guarantee everyone success. It is the function to make sure everyone has the opportunity. As said, the success is a result of initiative and enterprise.

If I am truly an old man, then I have been around the block a couple of times. Enough to know what works and what doesn’t. I have never had to settle for minimum wage. I have never drawn unemployment. I have never worked on the government dole. I, and my employers, have always made the maximum contribution to my social security. Government price fixing has nothing to do with it.

“Only a loser says that what I want to do isn’t adequate, so I’ll just quit.”

And, of course, that’s NOT what anyone is saying here, old man. The FACT is that many, many large corporations (like Wal-Mart) make HUGE profits off the hard labor of their lowest employees, while they treat those same employees like dirty…with horrible pay & little to no benefits. Once again, GREED is the primary motivation for many of these faceless corporations.

“It is not a function of government to guarantee everyone success”

…which, again, is NOT what anyone is advocating for here, old man. We’re talking about merely having working class families having just enough to get by, make ends meet, etc., etc….not be rich!

“It is the function to make sure everyone has the opportunity”

..which, of course, they don’t. If you really think that the poor, minorities, women, etc. are treated the exact same way that you & I are treated in the USA, then you are living in an even worse fantasy world than I already know you’re living in, old man.

“If I am truly an old man, then I have been around the block a couple of times”

…but yet you haven’t learned some very, very basic FACTS about how America works, which means that NO ONE should be listening to a damn thing that you have to say, old man!!

“Enough to know what works and what doesn’t.”

Nope, but feel free to try again old man. Pwing your sorry behind is oh so very easy for someone like me…lol…

“I have never had to settle for minimum wage.”

I have, a looong time ago when it was around $3.65/hr, which was a complete & total joke!

“I have never drawn unemployment.”

I have as well, when the maximum amount was ~$350/week, which was also a complete & total joke.

“I have never worked on the government dole.”

Not getting Social Security or Medicare benefits old man?? I highly doubt it, liar!

“I, and my employers, have always made the maximum contribution to my social security”

…which has recently been capped at only around $100K/year…big whoop.

“Government price fixing has nothing to do with it”

…which, again, NO ONE is talking about here, old man, but beat those strawmen all that you want to…you old fool! LOL…

You are but a babe in the woods. You believe in scientific models which are no more than a form of superstition. You do not comprehend that wage control is a form of price fixing. You do not comprehend that the so-called two parties are but different wings of the same bird of prey – the establishment party. True, they compete on issues of social conservatism/liberalism, but they are one in terms of government control of the people. Perhaps with more time and more experience your eyes and mind will open.

The basic economics of capitalism is sound and easily understood by anyone who can perform basic math. The textbook model involving land, labor, materials, and capital looks great on paper. But arrogantly treating people like just another commodity can and often does lead to business inefficiency and political problems. Here’s an example:

The CEO of my company received about 8700 dollars per hour in 2010 based on a 40 hour week. That’s about 5800 dollars per hour if you’re willing to allow for a 60 hour work week. That’s just the cash part of his compensation. I belong to a union and I’m reasonably well compensated for my work, but there exists a basic problem of credibility. Our CEO crows about our multibillion dollar profits and growing market share when addressing Wall Street fund managers but constantly rings his hands and complains about the crushing burden of union wages when addressing his employees. From the viewpoint of ordinary workers, he looks like what he is, a hypocrite. The business is healthy enough to pay one man 5 or 6 weeks wages every hour but I should accept a wage cut so he and a few others can receive a bonus worth more than my combined salary and benefits since I began working there more than a dozen years ago.

This kind of behavior does not inspire thousands of employees to do more than they absolutely have to. It kills any incentive to prevent expensive problems from developing and fosters nothing but a hostile us versus them environment.

What I think is not clear here is that it is not people who are treated like commodities, but rather their labor. And, in fact, their labor is a commodity. People sell their labor and are compensated for it.

It seems you’re familiar with basic principles of economics, so I’m sure you’re familiar with supply and demand curves. As a supplier of labor, you can set the price for your commodity, but it’s the consumer of that commodity that determines the level of demand at that price. If there’s more demand for your labor, then you can raise the price. If you want to increase the demand for your labor, you have to provide more value, over and above what other employees who are selling the same services provide. The same is true for any supplier of any commodity.

As a supplier of a resource, you are not entitled to a proportional share of the profits of the company that purchases it from you. You are simply selling them a service. If you want to share in the corporate profits, you could either work for a company that does profit sharing (which would probably not be a union shop, since the employees would be owners of the company), or you could buy stock in the company that employs you. Then you would be entitled to a share of the profits, rather than just being a resource vendor, which you are currently.

Or better, they trade their labor. It is a trade that enables the business to sell whatever product, goods or service.

I know, splitting the hairs a bit as I understood you perfectly to mean exactly what I’ve restated.

I wanted to use the opportunity to say, “Merry Christmas!” Happy New Year, too.

On December 31, 2011 at 1:22 pm Mister Guy said:

“What I think is not clear here is that it is not people who are treated like commodities, but rather their labor”

…and what is exceedingly clear is that you’re missing the entire point of Fowl’s post. He’s merely complaining about greedy CEOs & their complete lack of any empathy for their employees…who are the ones that *really* make his company succeed in the first place.

“If you want to share in the corporate profits, you could either work for a company that does profit sharing (which would probably not be a union shop”

Spoken like an advocate for the Wal-Marts of the world…ugh… Most profit-sharing agreements in the USA merely establish pension plans that are maintained by an employer to share profits with employees. In the USA, these kind of agreements must be tied to the basic compensation of the employee by allocating a profit sharing amount to the employee’s account based on the proportion of the employee’s salary to the total salary of all the plan’s participants. An employer doesn’t even need to earn actual profits to have a profit-sharing agreement! Wal-Mart would have their employees believe (wrongly of course) that they couldn’t do profit sharing if their employees unionized.

On December 18, 2011 at 10:53 pm Smile said:

I was a raging socialist when I arrived at this thread. After enduring all the “ugh, lol, lmao and myriad rude comments, I’ve decided to be as far right as I possibly can for the sole purpose of getting as far away as possible from Mr Guy.

Seriously, the clincher was his delusional accusations rather than discussion. Not in any particular order, the funniest were: “..they are all greedy…$350/week, which was also a complete & total joke.” Yet, he is the only one asking for more (for his living wage) and disgruntled that he doesn’t have what it takes to earn more so must resort to tactics of socialism.

Always trying to intimidate and bitch slap, as if the crudest/rudest gets one stamped as a winner to any argument.

Good economic policy is almost always bad social policy and vice versa. Treating people like transient or disposable “human resources” may look good on a balance sheet but it corrodes the willingness of employees to act in the best interests of their employers. Here’s the problem as I see it:

The basic economic model used by most employers is flawed because business managers knowingly ignore the fact that self interest is the driving force of capitalism. When you pay someone an hourly or monthly wage you probably think that you’re paying them to work.

Wrong.

You are paying them to avoid being fired or otherwise dismissed. If they have to perform useful work they will, but I’ve been in situations where my job was safer by doing very little. The employee who is compensated with a fixed wage is paid the same whether the employer is wildly profitable or just barely hanging on. Corporate executives tend to be intelligent, well educated people who understand the power of self interest, but they also tend to embrace the peculiar belief that their employees get out of a warm bed, scrape ice off their windshield, fight commuter traffic, and perform mind numbing tasks all day in order to make their employers rich. Employers also believe that they can make this problem go away by accusing their employees of lacking a work ethic. That’s the solution. Insult your employees and they’ll become more productive.

If you have an explanation for this behavior I’d really like to hear it.